Speaker Boehner Calls President’s Bluff as GOP Readies Jobs Package

House Speaker John Boehner says he will move a bill next week to address three economic imperatives set to expire at the end of the year, but the legislative concoction House Republicans are cobbling together could prove to be too toxic for Senate Democrats to support or for the president to sign.

"We had a great conversation with our members about an agreement that we would move a bill that would extend and reform unemployment benefits, that would extend the payroll tax credit while preserving the Social Security trust fund, and it would also include some of our jobs initiatives such as the Keystone pipeline and Boiler MACT," Boehner, R-Ohio, announced this morning.

The catch is the inclusion of the pipeline project, which sets up a surefire showdown with the White House. At a photo-op with the Canadian prime minister Wednesday, President Obama preemptively announced that he would reject - but not explicitly veto - any payroll tax cut extension that's tied to the Keystone XL pipeline project or other "extraneous issues not related to making sure the American people's taxes don't go up on January 1st."

"Any effort to try to tie Keystone to the payroll tax cut I will reject, so everybody should be on notice," Obama warned. "I don't expect to have to veto it because I expect they're going to have enough sense over on Capitol Hill to do the people's business, and not try to load it up with a bunch of politics."

Last month, the president delayed a decision on the project in order to study alternate routes for the pipeline, thus punting a politically contentious issue past the 2012 election.

Despite the president's warning, the speaker said the project is a "no-brainer" and he called on Obama to support the "bipartisan proposal." The $7 billion project by TransCanada would bring oil from the tar sands in Canada to refineries in the south of the United States. Republicans say the pipeline will generate $585 million in new taxes for states and communities along the pipeline route and TransCanada would pay $5.2 billion in property taxes during the operating life of the pipeline.

"The president says that the American people can't wait on jobs. Well guess what? We agree whole-heartedly with the president. The Keystone pipeline project will create 10s of thousands of jobs immediately. It has bipartisan support in the House and Senate," Boehner said. "It's pretty clear that president has decided to push this decision off for a year conveniently until after his next election. The American people can't wait, as the president said, and at a time when the American people are still asking the question: 'Where are the jobs?' I think this is a bipartisan proposal that the president ought to endorse."

Minority Whip Steny Hoyer, the No. 2 ranked Democrat in the House, said he is "disappointed that Republicans insist on playing political games with these critical policies" and called on Republicans to reassess their proposal.

"I have said repeatedly that Democrats are willing to work with Republicans to move these policies forward as long as unrelated, controversial policies are not attached, and President Obama said yesterday that he would reject a package that includes the Keystone pipeline," Hoyer, D-Md., said. "With so little time left before the end of the year, I hope Republicans reconsider their position and work with us to address these issues."

House Republican Conference chairman Jeb Hensarling, who was the Republican co-chair of the supercommittee on deficit reduction, pointed to consistently high unemployment during the Obama administration as justification to try the GOP's plan rather that veto it out-right.

"Every month that the president has been in office, unemployment has been at, near or above 9 percent. The president's economic policies have failed. We have not in this economy seen job creation," Hensarling, R-Texas, said. "Mr. President, we will have some of your ideas in this bill, but maybe it's time to try some of ours. Do not veto this jobs bill."

Boehner said that the House will bring the bill to the floor "next week" and said is "confident about our ability to move ahead" and pass the bill. One Democratic aide suggested Republicans would have scrapped the plan if they felt they could not get 218 votes on their own.

Majority Leader Eric Cantor predicted that "if the president is serious about his commitment to economic growth and jobs in this country, he'll sign this bill."

"This bill doesn't have everything in it that either side wants for sure, but from our perspective this represents a bill that does make some progress. It continues to change the culture of spending to one of savings here. This bill does ensure that we abide by the principle that we want people to keep more of their hard-earned money. And this bill does have some incremental steps towards continued efforts at economic growth," Cantor, R-Va., said. "If the president is serious about his commitment to join us to work together on the things that we can agree on, then he'll sign this bill."